Brock Murray, head of global development at Katipult, explains why more and more lenders are realising the benefits of tailor-made fintech software
Peer-to-peer lending platforms are waking up to the benefits of fintech software solutions in a rapidly changing regulatory environment and an increasingly online world.
This is a trend which Katipult’s head of global development Brock Murray calls “the passport to innovation.” And alternative lenders are starting to pay attention.
“We are starting to see an uptick in interest,” says Murray. “Companies are starting to realise that they need something that’s a bit more end-to-end and a bit more purpose built for their industry.
“In the capital markets, you do have a lot of these legacy systems – pretty dated software, usually not cloud based, and that’s where a lot of investor data is stored,” he adds.
“Most groups are still primarily using Microsoft as their main system to run deals and whatnot.”
Now, these same companies are starting to realise the value of using purpose-built technologies which can adapt to changing regulations and user demand across multiple jurisdictions. This is where Katipult comes in.
“In the UK specifically, we’re starting to hear more about servicing retail investors,” explains Murray.
“Its always the juggle of being more accessible to retail investors, but then also managing the compliance. [The regulator] will put out the rules, they’ll create some opportunities for retail investors, then if any little issue happens, they tighten the screws on everybody, and make it a lot harder to do that again. And then they reset the whole process.”
This is a frustration which Murray shares with a number of UK-based P2P lending platforms. While he hopes that the pandemic will have opened up more capital market opportunities for retail investors, he is aware that the regulatory and legal challenges will persist.
“We are starting to see the beginning of that next evolution of where the capital markets will go and where our technology will go as well,” he says.
“Whether that’s custodial services, investor onboarding and accreditation – a lot of that is being decentralized and will be very important.”
He has also predicted increased use of blockchain technology, and wider adoption of stablecoins and other cryptocurrencies in the months and years ahead.
“We’re always investing in our technology because we’re global,” says Murray. “We’re involved in some of the leading trends – whether it’s a market like Singapore which is very innovative or a market like Canada, that’s far more conservative.
“We’re balancing all of those needs and building these things into our products. So as the licence holder, you don’t have to worry about all these big technology investments and running a big customer development team and things like that. You can be participating in an evolving software product.
“It’s almost like a passport to innovation because you can access the innovation and the internationality that that comes with Katipult’s existing framework and business.”
Web-based software like Katipult’s can create a lot of efficiencies for fintech lenders, leaving them free to focus on doing what they do best, and hiring third party expertise to handle the more specialist tasks involved with cross-border compliance and back office processes.
“The people running these P2P lending platforms are finance people for the most part,” says Murray. “They’re really looking at building their business and managing much larger loan books and improving their customer service. They’re not trying to be custom software firms.”
Post-pandemic, Katipult expects to see more hybrid working models in place, with employees working remotely and companies becoming more reliant on software solutions to keep their teams connected and working towards the same goals.
This is something that Katipult has been working towards for many years, and it seems that the rest of the world has finally caught up.
“Our message hasn’t changed,” says Murray. “But now we’re finding that it is landing. I think we have a pretty compelling offer for a lot of groups that are in this space.”
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